On December 3rd 2020, RetailDetail and LD & Co went online to present the 16th edition of their annual Trade & Shopper Marketing Congress. More than 200 category managers and trade marketing professionals joined as 4 leading experts shared their views on the retail landscape in Covid times. The event was moderated by Luc Desmedt, managing director at LD & Co.
The corona pandemic has been disruptive for all industries and for different aspects simultaneously. In retail & FMCG, it is causing a return to the essence: consumers are changing their purchasing behavior, brand manufacturers are reviewing their range and promotional plan, retailers are focusing on loyalty and e-commerce. It has strengthened and accelerated many existing trends, but also sent some in a different direction.
So how do you keep winning at the moment of truth in corona times? Should trade & shopper marketing go back to basics?
Stefan Van Rompaey - Chief Editor - RetailDetail
He serves his weekly column "Filet Pur" as we like it: "à point", well seasoned and always with a bold wink. At the 2020 Congress, Stefan Van Rompaey shared trends and initiatives he spotted among retailers and brand manufacturers. We noted:
Back to the essence for both retailers and manufacturers: fewer SKUs, focus on the core, focus on growth, focus on profitability.
Health and wellness come to the fore.
Convenience now comes to your doorstep in food: “on-the-go” makes way for new solutions.
The e-commerce market share in FMCG in Belgium rose from 1,8 to 2,1%, but remains modest compared to neighboring countries.
Manufacturers are looking for new channels and business models.
Competition continues to increase. Exciting times ahead!
Price competition in corona times: retailers come up with different strategies to handle the ban on promotions. Border shopping is a pain point.
Colruyt is being challenged on several fronts.
End-of-year negotiations are expected to be challenging. Who pays the bill of this challenging year?
Invest in strategic partnerships now: relationbships and knowledge are key!
Read Van Rompaey's article "Dit was 2020: het essentiële foodretail jaaroverzicht." in DUTCH or "Rétrospective sur 2020 : l'analyse annuelle de l’essentiel du commerce de détail alimentaire"in FRENCH.
Stijn Demeersseman - Category Leader Personal Care Appliances - Amazon
After an international career of 20 years with traditional FMCG marketing icons such as Procter & Gamble and L'Oréal, Stijn Demeersseman took the plunge to Amazon where he manages the personal care appliances activities from London. Amazon is changing the rules of the game in retail. It does not possess that much more data than other retailers, it is the speed and depth with which Amazon analyzes them that gives them a competitive edge. Demeersseman predicts the death of category management as we used to know it. He states that from now on, it is all about SKU management, thus adding complexity to the retail business. Organizations must be prepared to transform and truly embrace online, realizing that digital is the job of everyone, not just of a number of digital experts. Crucial questions for brand manufacturers are how to adapt in order to be able to identify ‘pockets of growth’ more quickly and how to set up fruitful collaborations in a digital world.
Is your organization ready to go from category to SKU management? Read also "Zo tilt Amazon category management naar een hoger plan".
Luc Suykens - Harley Procter Marketing Director - Procter & Gamble
Building on 32 years of experience at P&G -“the” marketing school in FMCG - expert brand builder Luc Suykens states that focusing on the consumer . He reckons the corona crisis offers ample opportunities for marketeers. It is bringing marketing back to its essence: brands are once again becoming beacons of trust, the consumer is more central than ever. Brands need to restore confidence in times of crisis, and prove their added value more than ever. That was what it was all about from the start, and now digitization added transparency to the game. In that sense Suykens reckons we are back to square one. But the consumer is no longer the same: changed composition of the average family, more singles, an older and more urban populations. Distribution changes too: supermarkets are no longer the only sales channel for a company like P&G. New business models are gnawing at the food retail market share. Suykens believes however that supermarket that manage to integrate offline and online still have a major role to play.
He does not expect brands to invest more in direct sales to consumers, but sees retailers reducing the number of certain of categories they choose to sell in their stores. The question for manufacturers then is: does the retailer offer an alternative online to keep that consumer, or does he reject that consumer? ” Suykens does not see manufacturers taking over as distributors, unless in niche segments: “A manufacturer is not a good distributor. We are good at large processes, in terms of logistics, but we are not very flexible for one-to-one sorting and delivery of packaging. Retail is a different culture, a different business model.”
Sustainability remains key, according to Suykens, with themes such as social commitment, CO2 reduction, packaging and circular economy. He even sees an acceleration, forcing manufacturers to completely reinvent themselves. On the one hand, there is the trend towards "home made" and local, and on the other hand global players have the scale and technology to realize sustainable breakthroughs. "The question is not whether one model will win over the other, the two have their role to play side by side", says Suykens.
More from Luc Suykens in Dutch on the RetailDetail website article "Dit is een ongelofelijk goede tijd voor marketing"
Raffael Li Preti - VP Commercial Unit Fresh - Delhaize
In a live interview, Raffael Li Preti clarified Delhaize’s expectations regarding strategic partnerships with suppliers, the impact of COVID-19 on negotiations and the opportunities the new SuperPlus loyalty program offers to customers and brand manufacturers.
At Delhaize Fresh, the mission in Corona times remains to make healthy food accessible to all and to safeguard the purchasing power. In that respect, Delhaize was surprised to see inflated prices and substantial differences between suppliers in the current market, impacting the negotiations. In line with that, Delhaize set its priorities and chooses to work with selected suppliers to ensure the strategic fit. The first wave of the Corona epidemic had already made clear which partners could be counted on. Li Preti stresses the importance of relationships with manufacturers that are based on mutual trust and on clear, transparent communication. Delhaize was therefore very pleased with the recent Advantage Report that gave them a very good score on communication of the strategy.
Li Preti sees a move away from push marketing, and an increase of the need to understand the customer better and supply answers to points they raise. Segmentation can be a handy tool, but eventually, Li Preti believes a retailer has to target the individual, unique customer. So 11 million segments in Belgium...Other trends to watch according to Li Preti are the rise of the importance of proximity and of healthy foods.
Sustainability in rooted in the heart of the Delhaize strategy through the cooperation with local associations that help reduce food waste. Li Preti demonstrated how Delhaize pioneers in reducing food waste further by giving 56% of its food waste a second life, such as in soups, juices etc. The ambitions is to raise that share to 80%.